Economic globalization and the evolution of talent management practices

Tipping Point for Talent Management

The economic environment and the need for talent management practices

The modern day economic environment is the result of numerous processes of change. The end result is a complex economic climate characterized by varying degrees of governmental intervention, the promotion of markets regulated by demand and supply or by liberalization and globalization. All these economic elements -- as well as several others more -- have generated a new need for talent management practices. Examples in this sense include:

The access to information led to the creation of more pretentious customers

The more pretentious customers demanded high quality products and services, which could only be offered through talented staff members

At a global level, a trend is observed of GDP generation from services more in the detriment of industry and agriculture (Central Intelligence Agency, 2010). But services can only satisfy the customers when they are delivered by high skilled staff members.

As a final specification, it should be noted that, unlike an initial perception, the emergence of the internationalized economic crisis has not halted talent management practices, but it has in fact created new grounds for their implementation. To better explain, a major mistake of most economic agents is that of striving to deal with the crisis by downsizing. Combining the downsized employees with the individuals who lost their jobs due to organizational bankruptcies, the availability of labor force significantly increases. In this context, organizational leaders are presented with the opportunity of accessing talented individuals who would otherwise be unattainable (HR Malaysia, 2009).

2. Globalization and the tipping point of talent management practices

The forces of globalization have represented one of the primary generators of enhanced talent management practices. Globalization opened national boundaries and allowed economic, political, technological and otherwise values and practices to transcend boundaries. A direct impact of the opening of boundaries was an increased organizational access to foreign resources, including capitals, technologies, commodities, but also labor force. Several organizations engaged in processes of outsourcing by which they took work outside one country to have it completed within a more cost effective region. But the labor force in the cost effective country was seldom trained and able to perform the tasks at high quality standards. The need for talent management rose both from the necessity to train the foreign workers, as well as from the need to adequately manage them.

The second means in which globalization forced talent management refers to incremental levels of competition among economic agents, which was created as the result of boundaries opening and market penetrations by foreign competitors. In this context, the adequate management of the human resource became an organizational need and a competitive strategy.

4. Talent management practices and talent retention

As early on motivational theory has shown, each individual -- or at least each specific and homogenous group of individuals -- is driven by specific elements. This finding can easily be extrapolated within the business community to understand that the employees are driven by various elements. While some search for the sense of belonging to a professional formation, others seek to be professionally recognized or financially rewarded. This realization specifically materializes in a necessity for economic agents to develop and implement personalized motivation and retention strategies. Some relevant example of noteworthy retention strategies include:

Flexibility in the working schedule, in the construction of team or in the selection of the projects on which to work

Employee empowerment and inclusion in the decision making process

Administrative transparency

Financial and non-financial rewards

Support in professional formation.

5. Effective talent management, organizational performance and shareholder value

Within the modern day community, talent management is becoming less and less of an option and more and more of a necessity. Talent management is in fact a competitive strategy through which economic agents increase their chances of improving the organizational performances and creating value for the shareholders.

At a most simplistic level:

Talent management creates better skilled staff members who are better able to increase their technical expertise and the task efficiency

Talent management creates more driven and motivated staff members

Better skilled and motivated employees increase their performances and their support in helping the organization reach its overall objectives

(Schiemann, 2009)

Increased organizational performances materialize in higher quality products and services or decreased delivery times, which eventually translate into higher levels of customer satisfaction and an improved customer experience and value

Increased customer satisfaction generates higher levels of sales, which in turn materialize in increased organizational revenues and the ultimate creation of shareholder value. Additionally, shareholder value can also be created through reputation improvements in the economic entity, which might allow them to sell their stocks for higher prices.

Reference:

Schiemann, W.A., 2009, Reinventing talent management: how to maximize performance in the new marketplace, John Wiley and Sons

Talent management, Bnet, http://www.bnet.com/topics/Talent+Management last accessed on August 5, 2010

2010, The world factbook, Central Intelligence Agency, https://www.cia.gov/library/publications/the-world-factbook / last accessed on August 5, 2010

2009, 2009: economic crisis or opportunity, HR Malaysia, http://hrmy.wordpress.com/2009/02/19/2009-economic-crisis-or-opportunity / last accessed on August 5, 2010